Despite slowdown, a startup is still the place to start your career

NEW DELHI | MUMBAI: What's your business model? What is the value of equity being given? What's your customer-acquisition cost?

These aren't questions investors are putting to startup founders. Instead, they are being fired at them by people that startups are looking to hire, during and before job interviews.

"Potential recruits are asking us the same questions as investors. The people who are applying now are much smarter," said Mohit Gundecha, founder, Jombay, a talent assessment startup that has 50 employees and plans to add 25 more this year.

In the season of pink slips on startup job street, it's not all darkness and despair. Employment experts and startup veterans say the churn is merely the wheat getting separated from the chaff. For the right talent, it still makes sense to bet on a career in startups, they argue.

PwC started an independent cluster on startups to spot the next set of unicorns among the new-age companies six months ago. The firm has identified 15-20 people across locations in India to keep an eye on those startups that have potential to scale.

The startup story is still going strong, said Abhishek Goenka, the PwC partner leading the initiative.These companies are typically in angel investment stage. Some of these are doing cutting-edge work in the field of tech, robotics, artificial intelligence and high-end manufacturing. "We are betting big on startups and it makes sense for talent to join startups — it still looks good on your CV," Goenka said.

MakeMyTrip group CEO Deep Kalra said the average age of an employee in a startup is somewhere in the mid-20s, implying that younger and less experienced but highly talented professionals are getting the opportunity to work on and manage critical areas. Not something that happens in a conventional, mature company where years of experience matter more. "Of course, jobseekers, while evaluating startups as potential workplaces, must evaluate the company, its values, financial situation etc., but this temporary phase must not deter them from deciding to work in a startup," he said.

Gazal Kalra, co-founder of Rivigo, agreed. The surface transport logistics provider, which raised $75 million from private equity firm Warburg Pincus in November, is still actively hiring, both laterals as well as on campus. Kalra said she has been surprised by the perceptive questions being asked by potential hires, something that didn't happen even a few months earlier.

"Startups provide an unparalleled opportunity in terms of the quality of work, sense of impact and early exposure to the leadership team," she said. "Those factors still hold true. What has changed in a big way is that candidates are now doing much more research into the background of startups."

The good thing is that such candidates understand the fundamentals of the business. "It's no longer a fashion to join. The ones who are evaluating the move are more serious about the opportunity and the role as well," she said.

Investors said startups will continue to create jobs and that now's a good time as any to get in. Funding deals may have declined in the recent past, but the startup story is far from over. ET reported recently that a new wave of small Japanese investors is scouting in India for early stage startups, signaling a return of confidence.

Also, while the likes of Snapdeal, PropTiger and Craftsvilla may be making headlines for their recent layoffs, a bunch of other big and small players including Flipkart, Amazon, Paytm, Ola, Uber,Portea Medical, Rivigo and Swiggy are looking to hire.

According to Krishnan Ganesh, serial entrepreneur and partner, GrowthStory, both the euphoria of two years ago and the current gloom are overstated from the point of view of investors, entrepreneurs and employees joining the startup ecosystem. The truth is somewhere in between, he said.

The sector has created millions of jobs, whether direct or indirect. Compared with this, the layoffs are in the thousands, he said.

"It is established everywhere that the real new job creation will happen not in traditional sectors, but in this new-age and small companies. You will miss out on huge opportunities if you get affected by all the noise. It's suicidal for the youth to get swayed — they need to get into where the jobs are," Ganesh said.

Putting things in perspective is important, he pointed out.

"One of the reasons why things seem so much worse than they actually are is because of the way we glamorized startups," he said. "L&T alone laid off so many, so many textile industry workers got wiped out but there wasn’t so much hype."

Investors and startup founders feel that lessons have been learnt from the mistakes of the past.

"I still feel joining at an early stage startup with strong fundamentals is a good idea," said Gazal Kalra. "Otherwise, what we have seen in the past is that startups which have scaled up really fast have had this tendency to throw people at problems, instead of trying the fix the problem itself. That is changing."